This invention relates to a means for providing a restricted purpose, commercial monetary regulation method.
Systems for regulation of commercial transactions on the basis of pre-established criteria have existed for some time. The utilization of credit cards, debit cards and individual department store credit cards in lieu of cash payment is an ever increasing phenomenon. Along with the increase in utilization of these cash substitutes, however, abuse of these cards by authorized and unauthorized individuals has necessitated the development of a wide variety of methods designed to identify and prevent card abuse. Examples of various means utilized to prevent card abuse include arbitrary selection of various credit cards presented to an examining device for selection for inquiry as to ownership and validity as disclosed in Goldman, U.S. Pat. No. 3,566,081 and Goldman, U.S. Pat. No. 3,891,830 wherein a credit card verification system is utilized with credit cards that contain information such as credit limits, the number of transactions within a certain period of time and a comparison of whether or not any credit still remains within the prescribed limits. Yet another method for preventing the unauthorized use of cards is disclosed in Basset et al., U.S. Pat. No. 4,439,670, wherein the card of that invention collects information on the number of inaccurate attempts to enter a confidential code for use of the card and, once the number of unauthorized attempts reaches a predetermined value, the device energizes a control circuit which disables the card.
Manufacturers of cards have utilized various other means and methods to limit unauthorized use of cards such as limiting the period of time within which the credit card is valid. Nothing about this method, however, prevents authorized or unauthorized use of the card within or even above maximum limits over a short period of time.
Other protective means have been established by the acceptors of cards such as "floor limits" which are adopted so that any credit card transaction above a certain limit would require authentication and authorization. This system clearly does not prevent authorized or unauthorized use below the floor limit nor is the system universally adopted so that an unauthorized credit card holder can simply go to another store with higher or no limits and still use the card.
As can be seen from the above discussion, existing devices and methods for preventing unauthorized use of cards are ineffective and/or cumbersome in that expensive electronic screening equipment is required or modification of credit cards by providing sophisticated internal micro processing means are required to effect a still non perfect solution. An understanding of the problem is facilitated by reviewing the various types of cards currently in use as well as other payment methods that are currently available.
National and international credit cards such as Master Card and Visa are issued primarily to consumers based upon the credit worthiness of the consumer card holder. These cards are almost universally accepted for the purchase of almost any product or service. Additionally, purchases can be initiated by phone. Purchases can also be electronically authorized and captured, recorded, for payment from a prepared statement forwarded at a later date to the card holder.
Department store credit cards are issued by major national retailers, such as Sears, on the same basis as national credit cards. That is, cards are issued to consumers based on the credit worthiness of the card holder. Also, like national cards, department store cards may be used to purchase any product or service offered by the retailer in their stores or catalogs. Also, purchases may be initiated by phone and payment is made to the retailer as a byproduct of the operation of the credit card portion of the retailer's business when customers are later billed for their purchases.
Gasoline credit cards operate in much the same manner as department store credit cards and are issued by major oil companies to both consumer and commercial customers, once again, based upon the credit worthiness of the applicant. Similarly, these cards are utilized to purchase a wide variety of products and services from oil company outlets world wide. Payment to the oil company results from the collection process related to the operation of the credit card portion of their business wherein a bill is sent to the credit card user for payment at a later date.
"Fleet" cards are issued to businesses by financial institutions for the purpose of purchasing gasoline and/or maintenance services for vehicles owned by the company at service stations that have agreed to accept the Fleet card for payment. The financial institution pays the service providers and charges an account of the cardholder business maintained at the financial institution for that purpose. The card must be presented in person and an identification code provided by the individual purchasing goods or services to initiate payment. A variety of goods and services may be purchased at any service provider that displays the Fleet card emblem.
A relatively new innovation in cards is a debit card issued by financial institutions to retail customers to allow electronic access to customer's accounts with the financial institution. Cards may be used to obtain cash and conduct other financial transactions through automatic teller machines. Additionally, these cards may be used to purchase goods and services at businesses that participate in point of sale networks with specific financial institutions. These purchases are limited to "in store" purchases due to the necessity to activate the card by use of a confidential personal identification number or a signature on a paper receipt.
A popular consumer payment option is telephone bill paying. These accounts are offered by financial institutions to retail customers to initiate regular periodic payments by use of a touch-tone telephone. Payment instructions are followed by the financial institution by charging the customer account and mailing a check to the designated payee. The payee cannot initiate the payment and cannot use telephone bill paying as a guaranteed method of payment at the time a product or service is sold.
An important new electronic payment method is the origination of charges by a supplier of goods or services through the Automated Clearinghouse (ACH) network. The supplier certifies to his financial institution that he has authorization from customers to originate charges to their bank accounts through the ACH system and provides the detailed account information to his financial institution to initiate the charges and to issue credit for them into the supplier's account. Financial institutions carefully restrict the use of the system to the most credit worthy suppliers (electronic collection of monthly insurance premiums by insurance companies is a typical example). While the supplier can receive credit immediately, there is no guarantee that the charges will not be returned unpaid and charged back to his account.
While other systems exist, the card and payment methods described above exemplify the overwhelming majority of non cash payments today. A draw back to most of the cards and card validation or control systems known in the art is that once a card is issued it is accepted by an extremely wide variety of businesses. As a result, commercial enterprises are reluctant to obtain credit cards and cards of other similar types for their employees due to the real possibility of abuse of the credit card by employees. Thus, there is a need in the art for a system for providing a restricted purpose commercial monetary regulation means which may be given to employees without fear of widespread unauthorized purchase of material that does not directly benefit the employee's company. It, therefore, is an object of this invention to provide an improved restricted purpose commercial regulation system that may be freely given to employees without fear of unauthorized purchase of material of no benefit to the company and that still provides guaranteed payment to the provider of a special good or service to the card holder.
Referring to the following diagram, further objects and advantages of this invention over the prior art are demonstrated in that it: (1) is available to any purchaser of a specified product or service, (2) is electronically authorized and captured at the point of sale, (3) provides immediate payment to the supplier or seller, (4) provides a detailed audit trail of all transactions, (5) limits the use of the payment method to a specific product or service provided by a specific supplier, (6) can be activated by telephone, and (7) provides guaranteed payment to the seller on acceptance. None of the cards or payment methods described above meet all of these requirements as summarized in the chart below. The column headed "New Method" represents the ability of the new invention to meet these requirements.
__________________________________________________________________________ PAYMENT OPTIONS National Dept. St. Gasoline Debit/ Tele. Fleet Originate NEW REQUIRMENT Cr. Card Cr. Card Cr. Card ATM Bill Pay Card ACH Debit METHOD __________________________________________________________________________ Unrestricted No No No Yes Yes No No YES Issue Elec. Authori- Yes Yes Yes Yes No Yes Yes YES zation/Capture Immediate No No No Yes No Yes Yes YES Payment Audit Trail Yes Yes Yes Yes Yes Yes Yes YES Restricted Use No Yes Yes No No No Yes YES and/or Payee Telephone Yes Yes Yes No Yes No Yes YES Activation Merchant No No No Yes No Yes No YES Guaranteed Pmt. Upon Acceptance __________________________________________________________________________